Policy Makers Worldwide See the Value of Cooperatives

Cooperatives exist to improve the lives of the members they serve.

October 01, 2012
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Credit unions are financial organizations deliberately structured to be different than for-profit firms or government initiatives—“not for profit, not for charity....”

Over the decades, credit unions have been included with other economic entities that call themselves cooperatives.

Fundamentally, cooperatives exist to improve the circumstances of the members they serve. They don’t have third-party shareholders determined to harvest profits from customers. And cooperatives don’t serve as income redistribution instrumentalities, like most government-run programs.

Credit unions were started in a time of significant need: Common workers had little incentive to save and no affordable place to borrow.

Most modern cooperatives have their roots in similar stories about dramatic unmet needs.


  • Cooperatives serve more than one billion people worldwide;
  • More than 100 million people are engaged as volunteers or staff in cooperatives; and
  • American credit unions count almost 100 million members, although multiple memberships reduce that number somewhat.

Notwithstanding, credit unions in this country are a huge component of the worldwide cooperative form of business, at least when measured in the context of the number of lives touched.

The tremendous impact of cooperatives is becoming apparent to policy makers around the globe. The United Nations designated this year as the International Year of Cooperatives. It doesn’t get much more visible than that.

And U.S. credit unions are enjoying a great public reputation, the result of many years of providing good service—all at a time when people are becoming more cynical toward big business and government.

What credit unions do has changed considerably over the years. Technology and new consumer behaviors have required credit unions to adapt to the times.

Why credit unions do what they do remains fundamentally unchanged.

At the end of the day, for credit unions to succeed, they must measure up to the value expectations of their members.

They don’t have to impress Wall Street analysts or deliver 15%-plus return on equity to shareholders. And they shouldn’t have to be overly concerned about peer ratios in financial performance reports (this, of course, has its limits).

Credit union boards of directors should make sure their credit unions provide value to the members they were elected to represent. They also must prudently manage return and risk to benefit members.

The events of the past decade—real estate bust, Wall Street greed, government largesse, bubble burst, debt accumulation, privacy invasions, fraud, and the worst recession in a lifetime—all illustrate the value and importance of cooperative organizations, especially credit unions.

Credit union leaders have been frightened by the challenges, and nearly overwhelmed by the complexities of information-era management. But they’ve genuinely come to appreciate the benefits of the cooperative business model.

Sourcing capital and fighting off the for-profit (bank) lobbyists are among many challenges.

All things considered, however, credit unions have come through the recession with strength, and they can now look to the future with a sense of unlimited opportunity. No longer will we look at the term “credit union” as a strategic anchor.

It turns out that the term “credit union” is a key point of differentiation. Consumers are learning that credit unions are wired to help them succeed.

MIKE MERCER is CEO of Georgia Credit Union Affiliates and CUNA chairman.

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Great article! Unfortunately, most employees don’t feel valued or appreciated by their supervisors or employers. In fact, research has shown that the predominant reason team members quit their jobs is because they don’t feel valued. This is in spite of the fact that employee recognition programs have proliferated in the workplace – over 90% of all organizations in the U.S. has some form of employee recognition activities in place. But most employee recognition programs are viewed with skepticism and cynicism – because they aren’t viewed as being genuine in their communication of appreciation. Getting the “employee of the month” award, receiving a certificate of recognition, or a “Way to go, team!” email just don’t get the job done. How do you communicate authentic appreciation? We have found people have different ways that they want to be shown appreciation, and if you don’t communicate in the language of appreciation important to them, you essentially “miss the mark”. Additionally, employees need to receive recognition more than once a year at their performance review. Otherwise, they view the praise as “going through the motions”. A third component of authentic appreciation is that the communication has to be about them personally – not the department, not their group, but something they did. Finally, they have to believe that you mean what you say. How you treat them has to match the words you use. If you are not sure how your team members want to be shown appreciation, the Motivating By Appreciation Inventory ( will identify the language of appreciation and specific actions preferred by each employee. You then can create a group profile for your team, so everyone knows how to encourage one another. Remember, employees want to know that they are valued for what they contribute to the success of the organization. And communicating authentic appreciation in the ways they desire it can make the difference between keeping your quality team members or having a negative work environment that everyone wants to leave. Paul White, Ph.D., is the co-author of The 5 Languages of Appreciation in the Workplace with Dr. Gary Chapman.

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